Marketing Spotlight - Accenture

Running head: Marketing Spotlight - Accenture

Marketing Spotlight - Accenture

What have been the key success factors for Accenture?

One large success factor for Accenture has been its timing. “Accenture started life as the consulting arm of accounting firm Arthur Anderson…In 1989, Anderson Consulting separated from Arthur Anderson in order to position itself against its IT services competitors” (Keller & Kotler, 1994/2006, 366). Accenture was able to take advantage of its large parent company and use its massive support to concentrate on becoming an efficient and popular name in the consulting market. Leaving Arthur Anderson before the corruption with Enron became public may have saved the company the same fate of many organizations that suffered for their connections to the accounting firm.

By “piggy-backing” on Arthur Anderson at a fortunate time, Accenture was able to correctly view the tide of the consulting business and branch out into the staffing business. I doing so, Accenture has successfully filled a niche by being able to supply the staff needed to accomplish the innovative ideas it provides to its clients. Says Ian Watmore, Accenture’s U.K. chief, “Unless you can provide both transformational consulting and outsourcing capability, you’re not going to win” (Keller & Kotler, 1994/2006, 367).

Accenture’s success has not gone unnoticed. “As this type of outsourcing is relatively straightforward…these are typically the areas where low-cost providers are moving in” (Ottink). While their competitors have been playing catch-up, Accenture has moved “up the food chain” and distanced itself from its competitors by handling “mission critical” processes, or the core processes of companies, where low-cost providers have no knowledge and experience.

Accenture has also benefited from strong advertising campaigns. Forced to remove the Anderson name from its title, Accenture launched an advertising campaign in 2000 to promote its new moniker. The result was a 350% increase in the number of firms considering Accenture’s services (Keller & Kotler, 1994/2006).

Whatever the change in business brings to the consulting or outsourcing markets, Accenture will adapt quickly and most likely ahead of their competitors. “Due to the strong performance culture and the flexible and implementation oriented nature of its employees, Accenture has been able to make difficult transitions much faster than its competitors (Ottink).

Where is Accenture vulnerable? What should it watch out for?

Accenture defines itself as “a global management consulting, technology services and outsourcing company…Accenture can mobilize the right people, skills, and technologies to help clients improve their performance” (Accenture, 2006). In short, Accenture is in the business of helping businesses make money. By combining transformational consulting and outsourcing capabilities, Accenture can more efficiently execute and deliver ideas to help companies grow their bottom lines. Accenture’s success “is demonstrated in its revenues ($11.8 billion in 2003) and its number-52 ranking on Businessweek’s Top 100 brands” (Keller & Kotler, 1994/2006, 367). In addition, Accenture has landed more and more contracts from the public sector (Harris Corporation, 2006).

Because of Accenture’s stellar performance prior to, during, and after, the dot-com crash (Accenture Ltd. CAN, has outperformed the S & P 500, Nasdaq, and the Dow since April 2001 with stock prices doubling during that time), Accenture must protect its investments from a number of different directions.

First, Accenture is being challenged by low cost providers. As a result, Accenture CEO Bill Green “reported pressure on margins and less deals that are attractive enough to cover the risks involved” (Ottink).

Second, Accenture is facing growing pressure from strong local companies, such as EDS, IBM, and other traditional IT players.

Third, the very nature of outsourcing is risky. Issues pop up that are sometimes difficult to predict or difficult to control. “For example at Sainsbury, problems on the client side with the implementation of a new distribution system and a new CEO leave Accenture vulnerable to a potential cut in the seven-year deal” (Ottink).

As Accenture is awarded more and more contracts (especially those from the public sector), these difficult to mitigate tasks will only increase.

What recommendations would you make to senior marketing executives going forward?

In order for Accenture to maintain its leading edge over the stiff competition, as